Global chip shortage to extend into 2022, warns TSMC

Chip held up with the TSMC sign in the background
(Image credit: Shutterstock)

The global semiconductor shortage crippling the tech and automotive industries is likely to continue into the next year, according to chip giant TSMC.

The Taiwanese semiconductor manufacturer said that, although the scarcity of auto chips will gradually ease during the current quarter, the overall semiconductor shortage will likely extend into 2022, the company revealed during an analyst call on Thursday, as reported by Reuters.

The high demand for chips, especially the 5-nanometre node type used in 5G-supported smartphones, helped fuel TSMC’s Q2 results, with the company reporting a profit increase of 11% from the year prior and a revenue growth of 28%.

The company expects demand to continue into the third quarter, estimating Q3 revenue to grow between 21% and 23%, with 3-nanometre node chips scheduled to enter trial production in the next few months.

TSMC’s CFO Wendell Huang told analysts on the call that the company’s “second-quarter business was mainly driven by continued strength in high performance computing (HPC) and automotive-related demand”.

"Moving into the third quarter, we expect our business to be supported by strong demand for our industry-leading 5-nanometre and 7-nanometre technologies, driven by all four growth platforms, which are smartphone, HPC, IoT and automotive-related applications,” he added.

TSMC’s chip shortage predictions echo the opinions of Cisco CFO Scott Herren, who in May confirmed that the company’s recent supply chain disruption, caused by the global semiconductor shortage, could last until the end of 2021, with a possibility that they would extend until 2022.


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Meanwhile, Dell Technologies founder and CEO Michael Dell said he expects that the chip crisis “will probably continue for a few years”, and warned that it could take some time before the semiconductor shortage is dealt with accordingly.

TSMC was previously involved in discussions with EU officials around building a TSMC semiconductor plant in Europe in order to remedy the impact of the global semiconductor shortage on the continent. However, the talks quickly collapsed and the chip company switched its attention to markets in North America and Japan, where a $338 million (£238 million) semiconductor research project will aim to develop new chip technology.

Sabina Weston

Having only graduated from City University in 2019, Sabina has already demonstrated her abilities as a keen writer and effective journalist. Currently a content writer for Drapers, Sabina spent a number of years writing for ITPro, specialising in networking and telecommunications, as well as charting the efforts of technology companies to improve their inclusion and diversity strategies, a topic close to her heart.

Sabina has also held a number of editorial roles at Harper's Bazaar, Cube Collective, and HighClouds.